United States District Court, W.D. Washington, Seattle
ORDER GRANTING AMAZON'S MOTION TO STAY MONETARY
C. COUGHENOUR, UNITED STATES DISTRICT JUDGE
matter comes before the Court on Defendant Amazon's
motion to stay monetary relief pending appeal (Dkt. No. 292).
Having thoroughly considered the parties' briefing and
the relevant record, the Court finds oral argument
unnecessary and hereby GRANTS the motion for the reasons
April 26, 2016, the Court granted partial summary judgment
for the Federal Trade Commission (FTC) and found Defendant
Amazon liable for violations of Section 5 of the FTC Act.
(Dkt. Nos. 224, 225, and 274-36.) On October 4, 2016, the
Court held oral argument on the question of the proper amount
and scope of monetary damages. (Dkt. No. 279.) On November
10, 2016, the Court ordered a notice-and-claims procedure as
the appropriate monetary relief. (Dkt. No. 287.)
January 6, 2017, the FTC filed a notice of appeal,
challenging the Court's order granting Amazon's
motion for partial summary judgment and dismissing the
FTC's claim for injunctive relief. (Dkt. No. 289.) Amazon
then cross-appealed on the Section 5 liability issue. (Dkt.
No. 291.) Amazon now moves this Court for a stay of the
monetary relief pending appeal. (Dkt. No. 292.) The FTC
argues that Amazon is not entitled to a stay. (Dkt. No. 294.)
The FTC argues, in the alternative, if a stay is granted,
only disbursement of refunds should be stayed or the Court
should amend its order granting monetary relief to award a
specific lump sum amount. (Id. at 8-11.)
Standard of Review
evaluating a motion for stay pending appeal, the Court
evaluates similar factors that are employed in deciding
whether to grant a preliminary injunction. Lopez v.
Heckler, 713 F.2d 1432, 1435 (9th Cir. 1983). The Court
considers “(1) whether the stay applicant has made a
strong showing that he is likely to succeed on the merits;
(2) whether the applicant will be irreparably injured absent
a stay; (3) whether issuance of the stay will substantially
injure the other parties interested in the proceeding; and
(4) where the public interest lies.” Nken v.
Holder, 556 U.S. 418, 434 (2009) (internal quotation
marks omitted). The first two factors are the most important
in the Court's analysis. Id. at 434.
Likelihood of Success
Amazon must prove a likelihood of success on the merits or
that “serious legal questions are raised” in its
appeal. Abassi v. INS, 143 F.3d 513, 514 (9th Cir.
1998); see also Leiva-Perez v. Holder, 640 F.3d 962,
967-968 (9th Cir. 2011) (“What is clear . . . is that
to justify a stay, petitioners need not demonstrate that it
is more likely than not that they will win on the
merits.”). Amazon presents four different arguments to
prove that there are serious legal questions raised in its
appeal: (1) the unfairness standard used by this Court is
incomplete; (2) Amazon's refund policy makes harm
avoidable and constitutes a countervailing benefit; (3)
Amazon lacked fair notice that unauthorized charges violate
the law; and (4) a previous FTC Commissioner dissented from
the FTC's issuance of an administrative complaint
targeting Apple's in-app purchasing practices. (Dkt. No.
292 at 6-10.) The Court rejected these arguments in the
summary judgment order and maintains its disagreement with
Amazon's arguments, most specifically Amazon's
argument that the Ninth Circuit has not considered the
Section 5 unfairness standard. See, e.g., FTC v.
Neovi, Inc., 604 F.3d 110, 1153 (9th Cir. 2010)
(following the three-part statutory test for whether a
practice is “unfair” under the FTC Act without
embellishment). However, the Court concludes that there is a
small amount of room for debate on the issues presented in
Amazon's appeal. Therefore, this factor tips in
must also prove that it will suffer irreparable harm if the
Court denies this motion to stay. Irreparable harm exists
when there are no adequate remedies at law. Latta v.
Otter, 771 F.3d 496, 500 (9th Cir. 2014). Amazon argues
that if the Ninth Circuit reverses this Court's decision,
“Amazon will be unable to recoup the refunds provided
to customers who submitted claims.” (Dkt. No. 292 at
5.) This assertion is uncontested by the FTC.
counters, however, that even if Amazon could satisfy the
irreparable injury factor, it is not entitled to a stay if it
does not make a strong showing that it is likely to succeed
on the merits. (Dkt. No. 294 at 7) (citing Nken, 556
U.S. at 427). However, this is an inaccurate statement of the
law. The Supreme Court has said that a “strong
showing” of likelihood of success, although important,
is one factor to be considered and that a stay is not a
matter of right, even if irreparable injury might otherwise
result to the appellant. Id. at 426, 427. Therefore,
a severe irreparable injury and small likelihood of success
on the merits, when balanced with the other two factors, can
still be the reasons to grant a motion to stay.
also argues that the irreparable injury alleged is
speculative because “there is simply no way to know how
many refund claims Amazon will actually receive or what the
dollar amount of those claims will be.” (Dkt. No. 294
at 7.) However, this argument is curious when the FTC
previously, and adamantly, argued that the Court should award
a lump sum monetary relief, instead of a notice-and-claims
procedure, because the lump sum amount suggested by the FTC
accurately reflected the injury caused by Amazon's unfair
in-app purchase practices. (See generally Dkt. Nos.
258, 269-1.) Moreover, the FTC seems at least to acknowledge